Ahmed, R., R., Streimikiene, D., Soomro, R., H. & Streimikis, J. (2022).

Digital Transformation and

Industry 4.0 Initiatives for Market Competitiveness: Business Integration Management Model in the
Healthcare Industry. Journal of Competitiveness, 14(4), 6–24. https://doi.org/10.7441/joc.2022.04.01

Digital Transformation and Industry 4.0 Initiatives

for Market Competitiveness: Business Integration
Management Model in the Healthcare Industry
▪▪ Rizwan Raheem Ahmed, Dalia Streimikiene, Riaz Hussain Soomro,
Justas Streimikis
Abstract
The main objective of this research is to examine the concept of industry 4.0 through digital
transformation using the business integration management model for market competitiveness
in the healthcare industry. Partial objectives are to analyze its effectivity in terms of a value
proposition, specifically, value delivery transformation, value capture transformation, patients’
empowerment, community-based transformation, market competitiveness, and globalization
transformation. We further analyze the role of advanced technology in digital transformation. For
this purpose, we employ a structured questionnaire completed by 4429 respondents representing
stakeholders from the United States and Pakistan. We use SEM-based multivariate approaches
such as exploratory and confirmatory factors analysis and conditional process modeling for the
data analysis. The findings of this study demonstrate that the digital transformation integration
model significantly and positively affects value delivery transformation, value capture
transformation, patients’ empowerment, community-based transformation, and globalization
transformation for market competitiveness. The findings further reveal that technological
advancement has a significant moderating impact between the digital transformation integration
model, value delivery transformation, value capture transformation, patients’ empowerment,
community-based transformation, and globalization transformation that also increase the
market competitiveness of healthcare industries, including hospitals, pharmacies, laboratories,
pharmaceutical companies, and other related industries. The findings of the undertaken study
have imperative theoretical and practical implications. Industry practitioners can gain optimal
financial and social competitiveness through digital transformation using the business integration
management model.

Keywords: Digital transformation, business integration model, market competitiveness, healthcare sector, value
delivery transformation, value capture transformation, patients’ empowerment, community-based transformation,
globalization transformation
JEL Classification: C12, C42, L8

Received: October, 2021

1st Revision: September, 2022
Accepted: October, 2022

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 1. INTRODUCTION
According to the Organization for Economic Cooperation and Development (OECD Stat,
2020), health spending is the largest share of public spending, further increasing the burden
of the healthcare system against the backdrop of an aging society. Therefore, the healthcare
system of Europe and the United States is looking for answers for both quality and cost for
market competitiveness. According to Hermes et al. (2020), around 75,000 pre-emptive deaths
happen every year in the United States, and health information technology (IT) is assuring a
solution to this problem. Alam et al. (2020) and Willie (2019) have documented that health
IT serves as a cost-saving lever due to a driver of improved experimental consequences of
competitiveness. However, health IT implementation and acceptance are slow (Kruse et al.,
2016). Digital transformation (DT) is defined as the process of change in information technology
that aims to enhance and improve multiple entities by making important changes to the entity’s
properties through a combination of information technology, communication, and connectivity
(Vial, 2019). The layout of digital growth strategies, the update and change in the organization’s
hierarchy, competitiveness, the merger and acquisition of digital assets, and all other aspects of
the healthcare firm can be affected by digital transformation (Verhoef et al., 2021). These types
of situations and phenomena are well known in many aspects of business research, such as the
marketing field, information system department of any healthcare firm, strategy formation team,
revolutionizing the business world in general, and implementation of the concept of industry 4.0
in the healthcare sector in particular (Machado et al., 2019; Rinker et al., 2021). The healthcare
sector of any country refers to the services of all types provided by doctors and other healthcare
workers to maintain the physical and mental state of people for their well-being. It has been
one of the main sectors where digital transformation is practiced (Hsia et al., 2019; Davidson
et al., 2018). According to Verhoef et al. (2021) and Hansen and Baroody (2020), the upgrading
and modern digital revolution in healthcare are introducing new opportunities related to the
different aspects of the business world. These opportunities generate new and more profitable
business models that provide multiple solutions to medical practice problems, generating value
for competitiveness and the aging culture and societal issues (Kokhno, 2020). The different
organizations of the healthcare sector, including pharmaceutical companies, hospitals, medical
test labs, health insurance companies, health workers (doctors, nurses, and technicians), and
the general community and patients, respond to many problems in a variety of ways, resolving
external and internal problems at the same time (Ahmed et al., 2019; Cennamo, 2021). The
supply chain has become the most critical factor for any organization and its competitors (Crisan
& Stanca, 2021). Thus, competition in any field moves the business world toward new research
approaches, such as better product or service development and improved product quality at a
reduced cost factor (Machado et al., 2019).
The main business chain or process component is the information system, which is a hallmark
of industry 4.0 (Rinker et al., 2021; Hermes et al., 2020). The information system is formulated
with regard to people who share information and material and communicate with different
people to gain knowledge (Hanafizadeh & Kim, 2020). The crux of the industry 4.0 concept
is that the information system is designed to benefit the employees of an organization and the
whole organization itself. It also helps to solve problems and increase market competitiveness

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 (Rinker et al., 2021; Schallmo et al., 2017). Healthcare organizations’ better and more efficient
logistic management system is also beneficial in generating profit (Tiwari, 2019). There is better
control of the process quality; the whole transaction chain, from the production process to the
distribution of the finished goods to its end-user is controlled easily with digital transformation
(Bican & Brem, 2020; Crisan & Stanca, 2021). An integrated system of the healthcare sector
is essential for survival and growth in the local and international markets (Linkous, 2019). In
order to reduce the factor of ineffectivity and inefficiency in the system, it is crucial to move the
business from the old approach process to the digital transformation system by using business
integration management as an industry 4.0 (Crisan & Stanca, 2021). The whole business process
and its operation of the healthcare industry, including pharmaceutical companies, hospitals,
medical test labs, health insurance companies, health workers (doctors, nurses, and technicians),
and the general community and patients, need to introduce re-engineering and the concept
of industry 4.0 (Rinker et al., 2021; Machado et al., 2019). It decreases time, avoids delay,
increases productivity, and reduces inefficiency in the different stages of processes (Weinstein
& Holcomb, 2020). Gardam (2020), Gökalp and Martinez (2021) have demonstrated that digital
transformations in the healthcare industry use the integration approach that is beneficial for the
business, and it shapes the business model of healthcare companies into industry 4.0 for market
competitiveness. There are many studies on the business model and digital transformation, but
the literature does not study the concept of industry 4.0 with new approaches (Crisan & Stanca,
2021). Many industries are moving toward digital transformation due to the novel situation caused
by the COVID-19 pandemic (Ahmed et al., 2020). The study is unique because it incorporates
the modified conceptual framework including digital transformation as an independent variable,
patients’ empowerment, community-based transformation, market competitiveness, global
transformation, real-time data transformation, and services-based transformation as dependent
variables, and advancement in technology employed as a moderating construct. Therefore, this
research paper helps healthcare companies to know the benefit of digital transformation using
the business integration management approach. This research paper is also helpful for healthcare
companies to develop insight into digital transformation and integration business models to
convert themselves into industry 4.0 for market competitiveness through sustainable long-term
competitive advantage.

2. THEORETICAL BACKGROUND
2.1 Digital Transformation
According to researchers, most companies use digitalization to offer customers more innovative
and fast services. Digitalization also transforms their traditional business model into a digital
one, enhancing an organization’s market competitiveness. Digital transformation affects the
country’s entire healthcare industry (Martins, 2019). Digital transformation helps a company to
build strong coordination and cooperation between the company’s different divisions and helps a
company to exchange and share data at the right time in the right place (Kokhno, 2020). In other
words, the digital transformation model is vital in aligning all the business elements (Schallmo
et al., 2017). According to the literature, there is no standard definition of digital transformation.
According to Mukha (2019), digital transformation is the ability to gather information, connect

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 all the company’s networks, society, and economy, and analyze gathered information that
can translate the information into a plan of action. Furthermore, the changes due to digital
transformation can become opportunities and problems (Cennamo, 2021). Another study reveals
that digital transformation could be described as the industry’s strategic and tactical evolution
through technology and digital business model (Clemons, 2019).

2.2 Roadmap for the Digital Transformation of Business Models

According to Schallmo et al. (2017), there are five steps to adopting the digital business model:
digital reality, digital ambition, digital potential, digital fit, and digital implementation. Digital
reality is to analyze the whole chain of business processes, sketch the estimated business model,
and collect data on customer requirements (de Reuver et al., 2018). The digital potential transforms
the data into digitalization and builds strategies and business models for future options (Teubner
& Stockhinger, 2020). Digital fit checking projects a business model to fit customer requirements.
The last step is digital implementation, the action step of implementing the finalized business
model (Schallmo et al., 2017). Due to the COVID-19 pandemic, digital transformation is growing
vastly, and now more organizations are adopting digital transformation integration (Crisan &
Stanca, 2021). The focus is shifted from data to digital form and digitalization to the business
process (Caliskan et al., 2021; Teubner & Stockhinger, 2020). By utilizing the critical element of
industry 4.0, the manufacturing industries can build and implement the new production process,
which enhances market competitiveness (Zubritskaya, 2019). The use of digital transformation
enables the company to enhance productivity, increase the platform to share information, and
work flexibility, collaboration, and market competitiveness (Machado et al., 2019). The companies
transform systems and processes into the digital transformation in which companies adopt the
industry 4.0 characteristics, for instance, improving service delivery transformation, inter-
connectivity, automation, machine learning, and using real-time data for overall operations, supply
chain, marketing, production, and financial teams across all levels of the company (Rinker et al.,
2021).

2.3 Services Delivery Transformation

The findings exhibit that the critical opinion of healthcare service delivery transforms into one
in which linked and distant care concentrated on prevention is provided by different stakeholders
(Schreieck et al., 2019). Such allied, network-based service delivery has been introduced into the
healthcare business due to new firms with emergent functions leveraging platform-based business
models for competitiveness (Clemons, 2019). As we observed fifteen new emerging segments,
it was evident that a massive portion of these segments embraced exchange-based platforms (de
Reuver et al., 2018). These new service delivery segments consist of telemedicine deliverers, medical
practitioner endorsers, health eCommerce, and several applications for self-care. Telemedicine
deliverers enable collaboration between healthcare suppliers and patients, for instance, through
video conferencing (doctor Insta) or engaged platforms (Physitrack), while doctor endorsers ease
searching, evaluating, and creating contact (Jameda) (Eden et al., 2019). However, the mobile
application FitWell provides self-care health trainers and matches users. Healthcare provider
companies are directly or indirectly involved in creating these platforms (Crisan & Stanca, 2021;
Bican & Brem, 2020; Gardam, 2020). Thus, we framed the following hypothesis:

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 H1: Digital transformation has a significant and positive relationship with service delivery
transformation.

2.4 Real-time Data Transformation

According to Bican and Brem (2020), the new function might activate further efficacy and
decrease healthcare facilities’ expenses, increasing market competitiveness. The primary concern
of the new emergent market segment is the continuous increase in the cost of medicines and
healthcare facilities. The increasing cost is due to the existing value chain and adding new
services; thus, the emergent market segment enhances the synchronization cost of traditional
firms (OECD Stat, 2020). Subsequently, traditional companies confront a gradually diverse
and entangled industry (Wirtz et al., 2019). The increasing convolution leads to higher costs in
recognizing valued stakeholders, ordinating a growing number of stakeholders, availing their
services (Fiebig, 2017; Gardam, 2020), adopting the industry 4.0 approach, and cultivating
early prevention and intervention using real-time data analysis through digital transformation
(Machado et al., 2019). Real-time data analysis enables health insurance companies, hospitals,
physicians, and pharmaceutical companies to make the right decision at the right time and at the
right price (Rinker et al., 2021; Crisan & Stanca, 2021). Thus, we used the following hypothesis
to ascertain real-time data transformation.
H2: Digital transformation has a significant and positive relationship with real-time data
transformation.

2.5 Patients’ Empowerment

The conventional healthcare industry did not provide the opportunity to interact with healthcare
providers. Primarily, patients had contact with doctors, hospitals, and health insurance providers.
At the same time, patients had limited interaction with healthcare providers (Gardam, 2020;
Hermes et al., 2020). Patients did not have scientific knowledge of the illness, prognosis, and
drug information. They were solely dependent on their doctors. Nevertheless, after digital
transformation, patients are fully aware of disease prognosis, treatment options, medication
side effects, and choosing suitable health insurance providers (Machado et al., 2019). Therefore,
patients can freely discuss the different options with their health providers due to the digital
transformation (Gardam, 2020). The digital transformation authorizes patients to control
their medical data and its reach and control through blockchain-based personal health records
(Crisan & Stanca, 2021; Fiebig, 2017). Thus, we framed the following hypothesis about patients’
empowerment:
H3: Digital transformation has a significant and positive relationship with patients’ empowerment.

2.6 Community-based Transformation

For the community-based platforms, researchers identified the emergent online learning and
market fragment of online community platforms (Crisan & Stanca, 2021; Caliskan et al., 2021).
Healthcare companies build social networking platforms for doctors and nurses to comment and
post medical images, their experiences, and treatment options, such as Univadis, a prominent
online platform for healthcare providers. Similarly, there are several digital platforms for the

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 community to interact with people with similar medical problems (Hanafizadeh & Kim, 2020;
Gardam, 2020). They can ask about their experiences and read reviews and comments regarding
a specific disease and its treatment options. The community can now freely discuss disease
prognosis, treatment options, drug side effects, and justified health insurance companies (Crisan
& Stanca, 2021). General communities can access their medical records and required services
through numerous online platforms and mobile applications without visiting their physicians
(Dijck et al., 2018; Eden et al., 2019). Hence, digital transformation has provided an effective
and efficient online platform for general communities. Therefore, we framed the following
hypothesis:
H4: Digital transformation has a significant and positive relationship with community-based
transformation.

2.7 Global Transformation

The global transformation has replaced the traditional healthcare provider system, transforming
healthcare facilities into remote, connected, and longitudinal healthcare providers, increasing
the healthcare industry’s market competitiveness (Zavadil et al., 2020; Caliskan et al., 2021).
In some cases, the concept of hospital and primary physicians perished altogether, and new
online organizations such as telemedicine have acquired the role (Wright, 2021; Smagulov &
Smagulova, 2019). Digital information regarding medical problems, treatment options, drug
choices, side effects, and other relevant information is universal due to the fast connectivity
of the internet (Kokhno, 2020; Agarwal et al., 2020). Similarly, physicians can get information
and expert opinions from senior doctors worldwide. Pharmaceutical companies and healthcare
providers have built and managed medical websites for doctors in any part of the world (Cennamo,
2021; Alam et al., 2020). Therefore, digital transformation has converted the world into a global
transformation. Hence, we framed the following hypothesis:
H5: Digital transformation has a significant and positive relationship with global transformation.

2.8 Advancement in Technology as a Moderator

There is an incredible advancement in information technology, which enables healthcare
providers to collect, store, process, analyze, and distribute the data useful for procurement
of raw material, production, supply chain management, distribution, finance, and marketing
operations that increase competitiveness (Caliskan et al., 2021). The smartphone and other
gadgets have revolutionized IT information (Hansen & Baroody, 2020), which supports the
capture of longitudinal, real-time health information such as sleep patterns, blood pressure, and
heart rate (Kellermann et al., 2013; Joseph, 2018). Advancements in technology enable progress
in data analysis, artificial intelligence, machine learning, and language processing, which helps
to make novel inferences and better understand newly gathered data (Crisan & Stanca, 2021).
Technological advancements increase the digital transformation in the healthcare sector finance,
sales, and operation; therefore, it behaves like industry 4.0 (Crisan & Stanca, 2021; Saima et al.,
2021). Thus, we framed the following hypotheses:
H6A: Advancement in technology has a significant moderating relationship between digital
transformation and services delivery transformation.

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 H6B: Advancement in technology has a significant moderating relationship between digital
transformation and patients’ empowerment.
H6C: Advancement in technology has a significant moderating relationship between digital
transformation and real-time data transformation.
H6D: Advancement in technology has a significant moderating relationship between digital
transformation and community-based transformation.
H6E: Advancement in technology has a significant moderating relationship between digital
transformation and global transformation.

3. RESEARCH, METHODOLOGY, AND DATA

3.1 Research Design, Sampling Strategy, and Data Collection
The nature of the undertaken study is explanatory and quantitative, with descriptive and
inferential statistics used. According to Ahmed et al. (2019), the targeted population for the
undertaken study is the brand and marketing managers of pharmaceutical companies, healthcare
professionals (doctors and nurses), the general community, and patients. We have selected
respondents who are well aware of digital transformation and its benefits in the healthcare sector.
We have used a modified questionnaire shown in Appendix-I. The questionnaire was circulated
to pharmaceutical companies, hospitals, pharmacies, doctors, nurses, the general community, and
patients. The data collection period lasted from January 2021 to June 2022; the data was collected
from the U.S. and Pakistani respondents. For the data collection, the study used both in-person
and online procedures; 29% of responses were gathered through in-person interviewers and a
self-administered questionnaire. The remaining 71% of responses were taken through online
sources, for instance, LinkedIn, Facebook, Google Docs, Instagram, and personal e-mails.
The first part of the questionnaire comprised standard demographic questions. Initially, for the
data collection, a total of 5000 questionnaires were floated through online and offline modes.
Eventually, we received 4429 correctly completed questionnaires. The response rate was thus
88.58%, which is considered reasonable during the COVID-19 pandemic. We have collected
1398 responses from pharmaceutical companies, hospitals, pharmacies, and medical health
insurance professionals, 1521 responses from healthcare workers (doctors and nurses), and 1510
responses from the patients and the general community. Based on the research objective, the
selected sampling technique is non-probability. Thus, we have employed the purposive sampling
technique with a five-point Likert scale structured questionnaire.

3.2 Scales for Measurement and Estimation Techniques

A total of seven variables are considered, with digital transformation as an independent variable.
Service delivery transformation, patient empowerment, community-based transformation, real-
time data transformation, and global transformation are taken as dependent variables. We have
employed advancement in technology as a moderating variable. The adapted items of digital
transformations were taken from previous studies such as Schallmo et al. (2017), de Reuver
et al. (2018), and Teubner and Stockhinger (2020). The modified items of services delivery

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 transformation were extracted from Schreieck et al. (2019), Clemons (2019), and de Reuver et
al. (2018). Similarly, items of patients’ empowerment were taken from previous literature such
as Machado et al. (2019) and Fiebig (2017); community-based transformation was adapted from
Hanafizadeh and Kim (2020) and Dijck et al. (2018); real-time data transformation from Wirtz
et al. (2019), Fiebig (2017), Machado et al. (2019) and Rinker et al. (2021). Similarly, the items
of global transformation were extracted from previous studies, for instance, Smagulov and
Smagulova (2019), Kokhno (2020), Alam et al. (2020), and Ahmed et al. (2019). The modified
items of advancement in technology were adapted from Hansen and Baroody (2020), Kellermann
and Jones (2013), and Hsia et al. (2019). The citation details are provided in Appendix I regarding
the questionnaire items. The research has used SEM-based multivariate structural modeling for
analysis purposes. For this purpose, we have employed SPSS 26, AMOS 26, and Conditional
process analysis v2.16.3 software. We have validated the hypothesized measurement model
through exploratory factor analysis and the structural model through confirmatory factor
analysis. Finally, we have employed conditional process analysis to evaluate direct and indirect
relationships between the constructs. The SEM-based multivariate approach accommodates
multiple items and constructs simultaneously. It concurrently evaluates the outer model (between
items and constructs) and the inner model (between independent, dependent, and moderating
or mediating variables). The measurement model evaluation describes the outer model; however,
the structural model shows the inner model. The conditional process modeling (SEM-based
multivariate) allows to examine multiple direct relationships of independent variables with
multiple dependent variables. Similarly, it also provides the prospects to examine multiple
mediations and moderation simultaneously.

3.3 Demographic Statistics

We have floated 5000 questionnaires to pharmaceutical companies, hospitals, pharmacies,
doctors and nurses, the general community, patients, and health insurance professionals. We
have received 4429 responses overall. The data was cleaned through SPSS 26; we checked the
missing, outliers, and incomplete values through the software, and, therefore, finally, we have
selected 4429 responses out of 5000. The demographic information includes gender, in this
research represented by 2402(54.2%) males and 2027(45.8%) females. The age bracket of our
demographics is between 18 and over 60 years, in which the most significant proportion of
respondents fall into the category of 18–30 years (1578 respondents), followed by 808 respondents
in the category of 30–40 years. The category of 50–60 years is represented by 804 respondents.
Regarding education, we divided the respondents into high school diploma, graduation, post-
graduation, and Ph.D. categories. Similarly, we have considered the working experience of their
respondents from 5 years to more than 20 years.

4. RESULTS AND DISCUSSION

4.1 Descriptive statistics
The data were converted into z-scores and analyzed for the descriptive statistics of all the constructs
using mean, standard deviation, skewness, and kurtosis. The mean values of respondents were

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 higher than 3.50, which is a significant number. The values of standard deviation and skewness
exhibited the range between ±1.5. Conversely, the readings of kurtosis are between ±3.0,
demonstrating that the considered data followed the normality pattern (Ahmed et al., 2020). The
normality of data is a prerequisite for employing the SEM-based multivariate approach. Hence,
the conditions of the SEM-based multivariate approach are fulfilled; thus, the study can proceed
with further analysis.

4.2 Exploratory Factor Analysis – EFA

The exploratory factor analysis validated the hypothesized items and constructs. For this
purpose, we employed a rotated component matrix, identification and validation of reliabilities
and validities using total explained variance, and Kaiser-Meyer-Olkin (KMO) and Bartlett’s
analyses. The SEM-based multivariate modeling is mandatory to check the factor loading,
Cronbach’s alpha, composite reliability, and average variance extracted for every construct
and item. Therefore, Table 1 demonstrates that the factor loading of each item (extracted
through the rotated component matrix) ranges between 0.80–0.95. The values of Cronbach’s
alpha and composite reliabilities are more significant than 0.70, and the reading of average
variance extracted (AVE) is more significant than 0.50 (Fornell & Larcker, 1981). Hence, the
convergent and discriminant validities are attained, and the consistency and validity of each item
and construct have been achieved. Thus, the considered hypothesized measurement model is
validated.

Tab. 1 – Reliabilities and Validities Analysis. Source: Own research

Factors Items FL CA CR AVE
Digital Transformation DT1 0.933 0.887 0.872 0.789
DT2 0.882
DT3 0.844
DT4 0.844
DT5 0.934
Services Delivery Transformation SDT1 0.932 0.889 0.904 0.795
SDT2 0.907
SDT3 0.765
SDT4 0.951
Real-time Data Transformation RTDT1 0.933 0.926 0.947 0.857
RTDT2 0.898
RTDT3 0.946
Patients Empowerment PE1 0.934 0.883 0.902 0.783
PE2 0.789
PE3 0.834
PE4 0.907
PE5 0.950

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 Community-based Transformation CBT1 0.932 0.902 0.837 0.814
CBT2 0.900
CBT3 0.861
CBT4 0.915
Global Transformation GT1 0.925 0.910 0.935 0.829
GT2 0.897
GT3 0.910
Advancement in Technology AIT1 0.937 0.895 0.885 0.804
AIT2 0.789
AIT3 0.913
AIT4 0.941
Note: FL=Factor loading; CA=Cronbach alpha; CR=Composite reliability; AVE=Average variance extracted;
DT=Digital transformation; Dependent variables: SDT=Services deliver transformation; RTDT=Real-time
data transformation; CBT=Community-based transformation; GT=Global transformation; AIT=Advancement
in technology.

4.3 KMO and Bartlett’s analyses

The value of the Kaiser-Meyer-Olkin (KMO) test is 0.714, which demonstrates a good value as
suggested by Ahmed et al. (2020) because it is considered a suitable range between 0.70–0.79.
Additionally, Table 2 exhibits the readings of Bartlett’s analysis with p<0.05 at a 5% interval level.
Hence, the correlation between variables and items is significant. Thus, it is further validated that
the considered items and constructs could be retained.

Tab. 2 – KMO Analysis & Bartlett’s Test. Source: Own research

Kaiser-Meyer-Olkin Measure of Sampling Adequacy .714
Approx. Chi-Square 72847.074
Bartlett’s Test of Sphericity Df 378
p-value <0.001
Note: Df=Degree of freedom

4.4 Total Explained Variance

The total variance explained demonstrates the cumulative variance of seven constructs. The
findings show that the cumulative variance is 77.027, which appears to be good against the
cut-off value of 0.50. Additionally, the value of every eigenvalue is more significant than one.
Hence, we conclude that the considered data is reliable and suitable for SEM-based multivariate
modeling (Ahmed et al., 2020).

4.5 Confirmatory Factor Analysis – CFA

According to Hair et al. (2019), the CFA directly examines the hypothesized measurement model.
This study considered one independent variable (digital transformation) with five items in the
hypothesized measurement model (Ahmed et al., 2020). However, we have taken five dependent
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 variables: services delivery transformation (with four items) and real-time data transformation
(with three items). At the same time, we have considered patients’ empowerment (with five
items), community-based transformation (with four items), and global transformation (with
three items) for the studied hypothesized measurement models. Additionally, we incorporated
technological advancement (with four items) as a moderating variable in the hypothesized
modified measurement model. Thus, the considered hypothesized measurement model has seven
constructs and twenty-eight items. The fit-indices values of the measurement model show that
all the readings are within the prescribed range. For instance, GFI=0.96, CFI=0.97, RNI=0.98,
IFI=0.97, NFI=0.92, TLI=0.98, PCFI=0.83, PNFI=0.81, and RMSEA=0.034. Hence, the
considered hypothesized measurement model is validated.

4.6 Structure equation modeling – SEM

Similarly, the structural equation modeling approach is helpful in examining the hypothesized
structural model (Ahmed et al., 2020). The study considered one independent variable (digital
transformation) with five items in the hypothesized structural model. However, we have taken
five dependent variables, for instance, services delivery transformation and community-based
transformation with four items each, real-time data transformation and global transformation
with three items each, and patients’ empowerment (with five items) for the hypothesized
structural model. Moreover, we incorporated advancement in technology (with four items) as
a moderating variable in the considered hypothesized modified structural model. Thus, the
considered hypothesized structural model has seven constructs and twenty-eight items. The fit-
indices values of the hypothesized structural model show that all the readings are within the
prescribed range; for instance, GFI=0.97, CFI=0.96, RNI=0.97, IFI=0.96, NFI=0.91, TLI=0.99,
PCFI=0.82, PNFI=0.80, and RMSEA=0.039 (Hair et al., 2019). Hence, the considered
hypothesized structural model is endorsed.

4.7 Hypothesized Direct Relationship

The direct relationship between the variables shown in Table 3 explains that digital transformation
is an independent variable. However, service delivery, community-based transformation, real-time
data transformation, patient empowerment, and global transformation are dependent variables.
Table 3 demonstrates that digital transformation has a significant and positive relationship
with service delivery, community-based transformation, real-time data transformation, patient
empowerment, and global transformation. Hence, the hypotheses H1 to H5 are substantiated
and accepted (T>±1.96 and p<0.05). The findings of this study are consistent with outcomes
of previous literature, such as Machado et al. (2019), Ahmed et al. (2019), and Agarwal et al.
(2020), who confirmed that digital transformation is essential because digitalization provides
the easiest way to share information at the required time and place. Previous studies also
confirmed that the services delivery transformation, real-time data transformation, patients’
empowerment, community-based transformation, and global transformation are essential for
digital transformation and industry 4.0 initiatives to gain market competitiveness in terms of
competitive advantage and long-term sustainable growth (Hermes et al., 2020; Wirtz et al., 2019).
Previous literature and current study exhibit that digital transformation increases the information
flow within and outside the healthcare sector, and all the stakeholders’ benefit (Ganjour et al.,

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 2020; Mukha, 2019; Davidson et al., 2018). The findings of previous studies also confirmed the
new roles and solutions of digital transformation in services, and distribution, which introduced
new medical and pharmaceutical industries (Kokhno, 2020; Willie, 2019; Wirtz et al., 2019; Vial,
2019; Machado et al., 2019).

Tab. 3 – Hypothesized Direct Relationship. Source: Own research

Standard-
Dependent Regression ized Regres- p-
SE T Decision
Variables Paths sion weights value
(β)
Services De-
H1 livery Trans- D.T. SDT 0.4474 0.017 25.91 0.000 Supported
formation
Real-time
H2 data Trans- D.T. RTDT 1.2048 0.018 64.74 0.000 Supported
formation
Patients Em-
H3 D.T. PE 0.5678 0.017 32.12 0.000 Supported
powerment
Community-
H4 based Trans- D.T. CBT 0.6451 0.016 39.60 0.000 Supported
formation
Global Trans-
H5 D.T. GT 0.3711 0.016 22.74 0.000 Supported
formation
Note: SE=Standard error; T=T or student-distribution; P=Probability=0.000; Independent Variables= Digital
Transformation

4.8 Hypothesized Moderating Relationship

The moderating relationship is examined through model 1 of conditional process analysis.
The findings of Table 4 exhibit that technological advancement significantly impacts the
relationship between digital transformation and services delivery transformation, community-
based transformation, real-time data transformation, patients’ empowerment, and global
transformation. Thus, it is also concluded that the hypotheses H6A to H6E are accepted (T>±1.96
and p<0.05). The previous studies also exhibited similar results regarding the advancement and
usage of technology in healthcare and other sectors. Pharmaceutical companies must adopt the
latest technology and integrate their business model through digital transformation (Cennamo,
2021; Clemons, 2019). According to Hsia et al. (2019) and Schallmo (2017), the healthcare sector
decreased the cost of production and services by adopting new technologies, enhancing market
competitiveness, and long-term sustainable growth with a competitive advantage. It would
only happen when the system is digitalized and all the chains are interlinked (Gardam, 2020;
Hein et al., 2020). The business model layout depends on the business field knowledge and the
adoption of the latest technology (Crisan & Stanca, 2021). Therefore, the findings demonstrate
that the evolving digital transformation of the healthcare sector leads to a surplus of innovative
market fragments, generic roles, and the disordering of the idiosyncrasy between information

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 technology, artificial intelligence, and the healthcare industry. Big data analytics, innovation of
new IT-based services, digital globalization, and real-time data properties signify the healthcare
sector as an industry 4.0, which also increases the market competitiveness in terms of long-term
sustainable growth and competitive advantage (Ahmed et al., 2020; Du et al., 2020; Rinker et
al., 2021).

Tab. 4 – Moderation Analyses. Source: Own research

Hypoth- Modera- Modera- Coef-
SE T P* LLCI ULCI
eses tor tion ficient
Moderating Effect of AIT b/w Digital Transformation (D.T.) and Service Delivery Transforma-
tion (SDT)
DT x
H6A: AIT –0.0692 0.0050 –13.71 0.0000 –0.0791 –0.0593
AIT
Moderating Effect of AIT b/w Digital Transformation (D.T.) and Real-time data Transforma-
tion (RTDT)
DT x
H6B: AIT –0.1384 0.0054 –25.68 0.0000 –0.1490 –0.1278
AIT
Moderating Effect of AIT b/w Digital Transformation (D.T.) and Patients’ Empowerment
(P.E.)
DT x
H6C: AIT –0.0860 0.0045 –19.30 0.0000 –0.0947 –0.0772
AIT
Moderating Effect of AIT b/w Digital Transformation (DT) and Community-based
Transformation(CBT)
DT x
H6D: AIT –0.0930 0.0034 –27.02 0.0000 –0.0997 –0.0862
AIT
Moderating Effect of AIT b/w Digital Transformation (D.T.) and Global Transformation (G.T.)
DT x
H6E: AIT –0.0693 0.0044 –8.45 0.0000 –0.0780 –0.0607
AIT
Note: Where ‘x’ is denoted for the multiplicative sign; * Indicates rejection of Null Hypotheses at p<0.05

5. CONCLUSION
This paper aims to evaluate the impact of digital transformation on services delivery transformation,
real-time data transformation, patient empowerment, community-based transformation, and
global transformation. The findings of the study confirm that digital transformation is positively
and significantly associated with service delivery, real-time data transformation, patient
empowerment, community-based transformation, and global transformation. Therefore, digital
transformation has converted the healthcare sector into Industry 4.0, and enhanced market
competitiveness. The study concluded that digital transformation increases the information flow
within and outside the healthcare sector for all the stakeholders’ benefit. Similarly, technological
advancement increases the role of digital transformation; therefore, we have treated advancement
in technology as a moderating variable. The findings of this research confirmed the moderation
of technology advancement between digital transformation, services delivery transformation,

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 real-time data transformation, patients’ empowerment, community-based transformation, and
global transformation. The undertaken study shows that the emergent digital transformation of
the healthcare sector is leading to an excess of innovative market fragments, value fragments,
and generic roles and the muddling of the peculiarity between information technology, artificial
intelligence, and the healthcare industry. Machine learning, extensive data analysis, innovation
of new IT-based services, digital globalization, and real-time data properties signify the
healthcare sector as an industry 4.0, which also increases the market competitiveness in terms
of long-term sustainable growth and competitive advantage. The healthcare sector decreases
the cost of production and services by adopting digital transformation integration and supplies
multiple products and services without any delay in the market. It would only happen when
the system is digitalized, and all the chains are interlinked. Digital transformation is essential
because digitalization provides the easiest way to share information at the required time and
place. Digital transformation can increase the revenue of the healthcare sector, build a strong
flow of information, and reevaluate the current business model, which also increases market
competitiveness. This research has several strengths and novelty; for instance, it provides
a novel conceptual framework for future researchers so that they can replicate this model in
other industries and different geographic regions. Similarly, the novel model also presents a solid
foundation for the marketers of healthcare industries to incorporate the elements in their future
strategies for long-term sustainable growth. The study has certain limitations; for instance, the
sample is collected only from two countries, i.e., the United States and Pakistan. Therefore,
the outcomes cannot be generalized to the entire world; hence, it is recommended that future
researchers may add more countries for more generalizable and robust results. Another limitation
of the study is the cause-and-effect relationship, as this research did not employ cause-and-
effect models. Thus, it is again suggested that future researchers use cause-and-effect models to
ascertain the causation between the variables.

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 Contact information

Prof. Rizwan Raheem Ahmed, Ph.D.

Indus University, Pakistan
Faculty of Management Sciences
E-mail: rizwanraheemahmed@gmail.com
ORCID: 0000-0001-5844-5502

Prof. Dalia Streimikiene, Ph.D. (corresponding author)

Institute of Sport Science and Innovations
Lithuanian Sports University
Sportro g. 6, Kaunas, Lithuania
E-mail: dalia@mail.lei.lt
ORCID: 0000-0002-3247-9912

Prof. Riaz Hussain Soomro, Ph.D.

Dow University of Health Sciences, Pakistan
Institute of Health & Business Management
E-mail: riaz.soomro@duhs.edu.pk
ORCID: 0000-0001-5914-2255

Justas Streimikis, M.Sc.

Lithuanian Centre for Social Sciences, Institute of Economics and Rural Development
A. Vivulskio g. 4A-13, LT-03220 Vilnius, Lithuania
E-mail: jutas.streimikis@gmail.com
ORCID: 0000-0003-2619-3229

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 APPENDIX – I.: Questionnaire

Factors Items Statement Citations

DT1 1) Digital transformation is an essential part of industry 4.0.
DT2 2) Digital transformation provided a long-term sustainable Schallmo et al. (2017), de Reuver et
and competitive advantage. al. (2018), and Teubner and
Digital DT3 3) I usually use the online services of the healthcare Stockhinger (2020)
Transformation industry.
DT4 4) Digital transformation provides added advantage to the
consumers and customers.
DT5 5) I prefer to go online for test reports and other healthcare
facilities.
SDT1 1) Digital transformation has played a tremendous role in
improving healthcare service delivery.

Services SDT2 2) Digital transformation also empowered the healthcare Schreieck et al. (2019), Clemons
Delivery industry, medical services, and health-related institutions. (2019), and Reuver et al. (2018)
Transformation SDT3 3) Digital transformation is a revolution for service delivery
in the healthcare sector.
SDT4 4) I usually utilize online healthcare services and deliveries.

RTDT1 1) Real-time data is become a revolutionary factor for

industry 4.0 and will convert it into industry 5.0.
Real-time Data RTDT2 2) Real-time data provides accurate planning and strategies Wirtz et al. (2019), Fiebig (2017),
Transformation for the healthcare sector. Machado et al. (2019), and Rinker
RTDT3 3) Real-time data transformation provides a sustainable et al. (2021)
long-term advantage to the healthcare industry.
PE1 1) Digital transformation empowered patients with online
services in the healthcare sector.
PE2 2) Online clinics, drug information, and other health-related Machado et al. (2019), and Fiebig
information empower the patients. (2017)
Patients PE3 3) Patients’ empowerment is a critical factor in the
Empowerment healthcare industry.
PE4 4) Online user-friendly healthcare services provide
significant opportunities.
PE5 5) Patients’ empowerment is crucial for the healthcare
industry due to digital transformation.
CBT1 1) digital transformation is an imperative source to the
general community regarding the healthcare industry.
CBT2 2) As an integrated community, I believe digital Hanafizadeh and Kim (2020), and
Community- transformation has provided us with up-to-date information Dijck et al. (2018)
based regarding the healthcare sector.
Transformation CBT3 3) Community-based transformation empowered the
patients and general public regarding healthcare issues.
CBT4 4) I have enough resources to interact with communities to
enhance my knowledge through technological platforms.
Global GT1 1) Digital transformation is the basis of global
Transformation transformation in the real business world.
GT2 2) Global transformation provides opportunities to have a
competitive advantage. Smagulov and Smagulova (2019),
GT3 3) Global transformation has provided a new marketplace Kokhno (2020), and Alam et al.
and virtual markets. (2020)

AIT1 1) Technological advancement has provided a new horizon

to the healthcare industry. Hansen and Baroody (2020),
AIT2 2) advancement in technology has provided a long-term Kellermann and Jones (2013), and
Advancement sustainable competitive opportunity to the healthcare sector. Hsia et al. (2019)
in Technology 3) advancement in technology provides the edge over
AIT3 competitors for long-term growth.
4) Advancements in technology empowered the consumers
AIT4 in the healthcare industry.

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